End of an eyesore? Owner may rebuild long-closed hotel

Saturday

May 11, 2013 at 12:01 AMMay 11, 2013 at 2:35 PM

The Treasure Island hotel, a hulking eyesore that has for nearly a decade dominated the Daytona Beach Shores skyline, might be spared the wrecking ball and be reborn as a new hotel — another step forward for a beachside on the rebound.

JEFFREY CASSADYBUSINESS WRITER

DAYTONA BEACH SHORES — The Treasure Island hotel, a hulking eyesore that has for nearly a decade dominated the Daytona Beach Shores skyline, might be spared the wrecking ball and be reborn as a new hotel — another step forward for a beachside on the rebound. "I think this is the beginning of a wave," said Jeffrey Hentz, president and CEO of the Daytona Beach Area Convention & Visitors Bureau. "I hope everybody has a surfboard and enjoys the ride."A subsidiary of Philadelphia-based RAIT Financial Trust, the owners of the long-shuttered hotel at 2025 S. Atlantic Ave., have told the city they are thinking about fixing up the 11-story, 227-room structure or even building and managing a new hotel on the property, city officials say. And though nothing is finalized, fixing up the building is a possibility, said attorney Mark Watts, who represents RAIT locally. "We're still fully evaluating all our options, but our goals (to get the property cleaned up) are the same as the city's," Watts said. RAIT officials declined to comment.The company has spent roughly the past six months cleaning the property in accordance with a settlement agreement it entered with the city last year. The agreement requires RAIT to either demolish or restore the building within the next year. In return, the city will forgive about $167,000 of the more than $800,000 in code enforcement fines the property has racked up over the past decade. Now that RAIT is considering restoring the structure, it and the city will have to negotiate a development agreement that would, among other things, establish a timeline for debris removal and give the city input on how the property is developed, said Michael Booker, Daytona Beach Shores city manager.The Daytona Beach Shores City Council will consider pursuing such an agreement at its Tuesday meeting. If the council approves, work on the building could begin by midsummer, Booker said. "We'd like to see a gutting of that building in time for the hurricane season," he said. The development agreement could give RAIT up to two years to restore the property, Booker added.The agreement would render moot portions of last year's settlement, given that it would ultimately end with the property being brought up to code and reopened, said Lonnie Groot, the city's attorney. Also, it would still provide for the code enforcement fines to be forgiven, he added. "I think the city of Daytona Beach Shores will be happy to see this," Groot said. "(The city and RAIT) would be spending their money on something more worthwhile than legal fees."A once-popular tourist destination, Treasure Island has stood empty since it closed in 2004 after sustaining hurricane damage.Bray & Gillespie LLC, who owned the hotel when it closed, hired a company to repair the building but a dispute brought work to a halt in 2005. Bray & Gillespie, which at one time owned 35 beachfront hotels, declared bankruptcy in 2008. A bankruptcy judge ordered RAIT to take temporary title to the Treasure Island in 2010, and last year a state appellate court determined the company owns the hotel.